FBI opens probe into phone hacking

Associated Press

LONDON

Rupert Murdoch and his son James first refused, then agreed Thursday to appear before U.K. lawmakers investigating phone hacking and police bribery, while in the U.S., the FBI opened a review into allegations the Murdoch media empire sought to hack into the phones of Sept. 11 victims.

Those two developments — and the arrest of another former editor of a Murdoch tabloid — deepened the crisis for News Corp., which has seen its stock price sink as investors ask whether the scandal could drag down the whole company.

Murdoch defended News Corp.’s handling of the scandal, saying it will recover from any damage caused by the phone-hacking and police bribery allegations. The 80-year-old told The Wall Street Journal — which is owned by News Corp. — that he is “just getting annoyed” at all the recent negative press.

He also dismissed reports he would sell his U.K. newspapers to stem the scandal, calling the suggestion “pure and total rubbish.”

A law-enforcement official in New York said the FBI was looking into allegations that employees of News Corp. tried to hack into the telephones of victims of the Sept. 11, 2001, terrorist attacks in the United States.

The decision to step in was made after U.S. Rep. Peter King, Sen. Jay Rockefeller and several other members of Congress wrote FBI Director Robert Mueller demanding an investigation, said the official, who spoke on condition of anonymity because he wasn’t authorized to speak publicly.

The allegation that Murdoch papers may have targeted 9/11 victims came from the rival Daily Mirror, which quoted an anonymous source as saying an unidentified American investigator had rejected approaches from unidentified journalists who showed a particular interest in British victims of the terror attacks. It cited no evidence that any phone actually had been hacked.

There was no indication members of Congress had information beyond the Mirror report. King spokesman Kevin Fogarty said the congressman’s letter “was based on what was in the public record and that those allegations were not denied.”

A federal law-enforcement official said the FBI routinely carries out reviews when an issue such as the Murdoch scandal becomes highly visible, and particularly when the matter involves a request from Congress. The official spoke on condition of anonymity because of the sensitivity of the matter.